Current debates over LNG export often ignore its primary benefits, such as enabling gas to be produced for sale to markets beyond the realistic reach of pipelines.

It also allows gas to compete with petroleum liquids where energy density is important, such as in powering ships, trains and land vehicles.

The international reaction to Russia's annexation of Ukraine's Crimean peninsula has put a spotlight on liquefied natural gas (LNG), which was already under debate in the US as a mechanism for exporting increasingly abundant shale gas. Meanwhile, LNG is emerging as a fuel in its own right, rather than just a means of transporting gas from source to market. What links these trends is LNG's capability to enable natural gas to approach the convenience and energy density of petroleum. The big driver for this is economic: UK Brent crude is currently over $100 per barrel, while natural gas in the US Gulf Coast trades at the energy equivalent of around $25 per barrel. That creates a significant incentive to build LNG plants, despite the recent escalation in their cost. Even after adding the equivalent of $20-30/bbl in expenses for liquefaction, shipping, and regasification to convert the LNG back into pipeline gas at its destination, the opportunity is significant. In Asia, where LNG sells for $14 or $15 per million BTUs, that's still less than $90 per equivalent barrel. And because gas can only be produced if it can be connected to a market, LNG enables more gas to compete in more markets, while providing customers a cleaner and cheaper fuel. This is not a new technology. Early demonstrations in the 1940s and '50s were followed by commercial-scale plants built to export LNG from Alaska, Algeria and Indonesia, establishing what has since become a global industry. Every LNG plant is designed to take advantage of the fact that at atmospheric pressure natural gas becomes a liquid at -259 °F ( -161 °C)--about 60°F warmer than liquid nitrogen--shrinking by a factor of 600:1 in the process. As long as it is kept below that temperature, it can be stored and transported as a liquid. That has important advantages over the alternative of compressing natural gas to create a denser fuel. For example, a gallon of LNG has around 2.2 times as much energy (based on lower heating values) as the same volume of compressed natural gas (CNG) at 3,000-3,600 pounds per square inch (psi). A gallon of LNG also has 98% of the energy of ethanol, and 64% that of gasoline. This makes LNG dense enough to transport economically over long distances, unlike CNG. These differences have a practical impact on the gradual penetration of the transportation fuel market by natural gas. While most natural gas passenger cars are based on the simpler CNG approach, LNG is gaining a foothold in trucking, particularly where the combination of low emissions and denser fuel--yielding longer range--is important. LNG is also emerging as an option for transportation modes that have had few viable alternative to oil-based fuels, such as in shipping and even rail where electrification is impractical. Replacing ships' bunker fuel with LNG could be a key strategy for responding to increasingly strict international regulations on sulfur and nitrogen oxide pollution from ocean-going vessels. The environmental benefits of LNG can be significant, when it replaces higher-emitting fuels like coal and fuel oil. Even after accounting for the energy consumed in the liquefaction process-- equivalent to 8% or less of the gas input to a new LNG plant--and in storage and transportation, lifecycle emissions from LNG in power generation are 40-60% lower than those from coal. Its advantage in marine engines is smaller, but still positive at around 8%, while reducing local pollution significantly. LNG isn't without drawbacks, including "boil-off", the gradual tendency of LNG in storage to evaporate due to heating from the environment outside the insulated tank. In stationary facilities the resulting gas can either be re-liquefied or delivered to meet local gas demand. In vehicles, it is vented after a specified holding time of around a week or more. That makes it more suitable for vehicles that are used frequently, rather than sitting idle for extended periods.

It's worth noting that while LNG is increasingly linked to shale gas in North America, nearly all the LNG currently marketed around the world is produced from conventional gas reservoirs, such as the supergiant North Field in Qatar, or the gas fields of Australia's North West Shelf. That would also be the case for a new LNG plant based on Alaskan North Slope gas, as described in a post here in 2012. Only a few years ago, government and industry forecasts were unanimous in projecting a large and growing US LNG import requirement, as domestic gas production declined. The number of US LNG import facilities expanded to meet this new demand, but the combination of the recession and the shale gas revolution has resulted in imports shrinking substantially since 2007. The Energy Information Administration now expects the US to become a net exporter of LNG in 2016, including exports from repurposed import facilities. They will join a market that now supplies around 10% of global natural gas consumption and accounts for a third of global gas trade.

A different version of this posting was previously published on the website of Pacific Energy Development Corporation.

Geoffrey Styles is Managing Director of GSW Strategy Group, LLC, an energy and environmental strategy consulting firm. Since 2002 he has served as a consultant and advisor, helping organizations and executives address systems-level challenges. His industry experience includes 22 years at Texaco Inc., culminating in a senior position on Texaco's leadership team for strategy development, ...

Thank you for this in-depth analysis. I am really missing a similar blog dedicated to the UK market. We are launching an energy blog soon at openenergymarket.com & definitely will be look up to this site as a great example.

I would add to your review the excellent safety record of marine LNG transport, which after decades of operation and millions of sea miles traveled has never seen a major spill or disaster.

Two main reasons why are the construction of the ship with insulated containers, unlike oil transport which still often has the hull of the ship containing the oil and is prone to disasters like the Exxon Valdez spill.

Secondly, when LNG is spilled it evaporates quickly leaving behind no trace, as long as combustion is avoided. Obviously if the vapors catch fire a major explosion can happen, but the flammability range of natural gas is fairly narrow which is why it does not happen often.

Natural gas is non-toxic, a rarity among our fuel choices and a feature I wish was more widely appreciated. You can pour LNG into a glass of drinking water and after it vaporizes off the water is still safe to drink. Try that with gasoline or diesel.

LNG is pure methane, devoid of particulates, sulfur, nitrogen and any other criteria pollutants. It is not simply a 'cleaner' fuel than other fossil fuels, it is the cleanest possible. The only exhaust is CO2 and H2O, which has GHG impacts but is otherwise non harmful to human health.

Edward, natural gas is by far the cleanest burning fossil fuel. It does, however, contain up to a few ppm’s sulfur. This level of sulfur content is much lower than all other fossil fuels; particularly coal and most petroleum vehicle/marine fuels.

The sulfur is removed when they form LNG. By virtue of liquefying the gas the process requires the gas to be pure.

Yes there is varying quantities of H2SO4 in conventional natural gas when it comes out of the ground, but synthetic natural gas is pure, and landfill gas is even dirtier than conventional gas. Methane hydrates in the ocean, though not commercial today, are meant to be ultra-pure.

Personally I find it interesting that this particular topic gets such little attention. Many of us burn methane and propane in our homes with no exhaust at all. You can not do that with biomass, gasoline, diesel or coal without making people sick becuase of all the contaminants. Meanwhile our society is ravaged with cancer, heart disease and asthma that is in large part due to breathing air polluted by the exhaust from all of our contaminated fuels. Imagine the beneficial health impacts for our entire society if we mandated all of our fuels be as clean as LNG. We have the technical capability to produce ultra-pure fuels we just choose not to do it for economic reasons. So rather than pay the price upstream at the refinery we pay the costs downstream in the form of illness and healthcare.